FIRST SEMESTER OF SESSION 2023/2024 (A231)

BIMS2093 QAWAID FIQHIYYAH FOR BUSINESS

GROUP ASSIGNMENT

TITLE:

STUDY ON WAQF MANAGEMENT IN MMU

PREPARED FOR:

PROF. MADYA DR. HYDZULKIFLI BIN HAJI HASHIM

PREPARED BY:

NAME NO. MATRIC

AMIRUL HUSNI BIN KHAIRUL ANUAR 294069

MUHAMMAD HAZIQ BIN HAMDAN 293616

MOHAMAD NAZRI BIN BADO 294140

NURUL JANNATUL AFIQAH BINTI AZHAN 271330

 TABLE OF CONTENT

TOPIC PAGES

1 INTRODUCTION 1

2 MODUS OPERANDI 3

3 ISSUE OF YUM PRIVATE UNIVERSITY 7

4 ISSUE SOLVING WITH LEGAL MAXIM 9

5 CONCLUSION 12

6 REFFERENCE 13
1.0 INTRODUCTION

The viability of university waqf has generated a lot of intriguing conversation. The idea is

currently being thoroughly investigated because the framework needs to be thoroughly examined

and evaluated on its own. In general, the question of university funding is growing more and more

important for the country’s capacity building. Consequently, this article discusses the potential for

the business sector in Malaysia, specifically the Government Link Corporations (GLC), to

collaborate with academic institutions in the establishment, financing and administration of

corporate universities (CoWU). Universities must have a culture of sustainable finance if they are

to enhance their impact on long-term capacity building and economic growth. Universities educate

and train postgraduates and undergraduates, draw in and share information with researchers

worldwide, introduce new technology, foster innovation and support public policy by producing

cutting edge research. Due to the enormous financial requirement of these admirable endeavors,

Malaysian institutions are facing previously unheard-of difficulties with their economic models.

For this project research, our main focus is more on waqf university which is Yayasan

Universiti Multimedia (YUM). In accordance with Malaysia legislation, Multimedia University

Malaysia founded Yayasan University Multimedia (YUM), also known as the Multimedia

University Foundation, in 200 as a non-profit, tax-exempt organization. YUM is also a non-profit

arm of Multimedia University (MMU). MMU is known as a premier digital technology university

and being a trendsetter of the private higher learning providers in Malaysia. The foundation’s goal

is to carry out nonprofit, benevolent endeavors in the fields of community work, education,

research,and culture. Corporate entities and private citizens provide money to the foundation in

the form of donations, endowments, zakat and waqf. The donations are subsequently distributed

to Asnaf (faqir, miskin, muallaf, fi sabilillah and ibn sabil) beneficiaries who are either community

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members or students. Scholarships are awarded to both domestic and foreign students as a kind of

financial assistance. Grants for research, Living Allowance, program sponsorship, medical and

disaster relief and general charity. Over 12,000 beneficiaries have benefited from financial aid

totaling RM 185 million that the organization has enabled since its founding.

The Higher Education Blueprint 2015-2025 was released by the Malaysian Ministry of

Education (MOE) on April 7, 2015. Regretfully, the blueprint was almost entirely directed towards

public universities. Private universities have more unpredictability and difficulties than public

institutions, which are well-funded and have more options to connect with potential donors and

earn money from commercialization. According to a 2015 Penang Institute Report, private

universities in Malaysia perform worse than public universities. With their financial condition

getting worse, many private colleges in Malaysia are finding it difficult to maintain standards of

quality and education. Lack of a business attitude, bad management, fewer revenue-generating

activities, tight finances, fierce competition and capital concerns are the main causes of poor

financial performance.

Malaysian private universities' ability to be financially sustainable is in jeopardy due to

present circumstances and business obstacles. Policymakers and other important stakeholders need

to address and have a conversation about the sustainability of institutions. Therefore, we firmly

think that the Corporate Waqf University (CoWU) model is a solution that will assist the goals of

NHESP 2020.

In a nutshell the purpose of this study is to provide some clarification on the topic of waqf

principal support for universities. Under Corporate Waqf University's banner, the corporate

sector's role in helping self-finance public and private universities is examined (CoWU).

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2.0 MODUS OPERANDI

Picture 1 : Corporate Waqf University Model (CoWU) for Multimedia University Modus

Operandi

Picture 1 shows the movement of Corporate Waqf University's liquid and illiquid assets.

The three components of the model are the waqf fund sources, the policy maker and professional

management, and the uses of waqf income.

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 Corporate Waqf University will first develop a waqf funding source of its own. Except for

corporate sukuk, the waqf fund source specified in the model is presently handled by Pasentren

DT and Vehbi Koc Vakfi (Koc Foundation). Koc University's viability is dependent on the

expansion of Vehbi Koc Vakfi's (Koc Foundation) business. Although the Koc Foundation's

owner/shareholder contributes a portion of the business's earnings as waqf, additional waqf

funding sources are also encouraged. Conversely, Pesantren DT lacks a corporate funder of its

own. Strong public fundraising efforts, positive corporate and business community support, direct

business involvement—such as from hotels and supermarkets in Shari'ah—DT Travel & Tours,

DT publication, and exceptional alumni are some of the factors that contribute to its sustainability.

The success of CoWU depends on the Islamic financial system and capital market, according to

the findings. Corporate sukuk and landed properties are complicated, but the first two sources of

capital—cash Waqf and e-cash—can be readily implemented with the help of the Islamic banking

system. E-cash and cash Waqf are appropriate for short-term project funding. Employees (TM

group and MMU staff) participate in the cash Waqf by deducting money from their monthly

salaries. About 22,000 people work for TM Group nationwide at the moment; the majority of them

are Muslims (TM Annual Report, 2018). Furthermore, the e-cash is intended for public and

university alumni, whose Waqf contributions are made directly to a designated bank via online

banking, monthly standing orders, or any other means of shariah compliance online payment

channel and university’s donation counter. In order to support the long-term strategic plan of

university development, corporate sector involvement is crucial. As the exclusive owner of MMU,

corporate entities and GLCs like TM can support the issuance of CoWU corporate sukuk for new,

long-term projects like the smart hostel and MMU campus in Iskandar EduCity. Additionally, the

model offers a way for a person or company to donate landed assets or properties as Waqf. YUM

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will be responsible for managing the rental income from landed assets and properties. Furthermore,

to expand the application of the CoWU model, in kind/other Waqf (IK Waqf) such as non-

monetary sponsorship, books, and collaboration are also welcomed.

Second, according to the CoWU model, a qualified Mutawalli (or Waqf agent) should

oversee the Waqf fund entirely. The Waqf frameworks in Turkey and Indonesia are nearly

identical, according to research. In terms of Waqf and endowment governance, both Indonesia and

Turkey are laxer. It appears that the state's role is centered on Waqf/endowment policy and

implementation. There is no direct intervention by either government in the administration,

policies, or operations of Waqf University or any associated institution. Waqf foundations are

therefore free to operate, make decisions, and plan for the expansion of their Waqfs. The

experience from Turkey and Indonesia could not be applied to Malaysia because Waqf is a matter

of state. New Waqf institutions in Malaysia must first receive approval from SIRC or one of its

designated mutawallis, such as Waqf Selangor Corporation (PWS). Owing to this constraint, the

suggested CoWU model was created using Malaysia's current Waqf laws. A license to act as a

Waqf agent is granted to the professional mutawalli, with backing from PWS/SIRC and the

corporate body (TM in the case of MMU-YUM). Every Waqf university or institution will

establish a Special Joint-Committee Board of Waqf (BoW). In order to maintain the integrity and

governance of the Waqf assets entrusted to them, the Mutawalli of the Waqf agent must be a

professional or a group of professionals with high integrity. He or she will report to the Board of

Waqf Joint-Committee (BoW). When free cash flow is available, the Mutawalli or Waqf agent

should have the autonomy to decide and/or act on behalf of BoW. In order to secure guaranteed

investments and create revenue through fund placement, the free cash flow needs to be capitalized.

The financial institutions that comply with Shari'ah and have been approved by the advisory panel

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and/or Bank Negara, such as Bank Waqf International, Bank Islam, Bank Muamalat, and Bank

Rakyat, are where the short-term placement, capital guaranteed investment, and repo deposits

should be made. The management of capital project investment is one of Mutawalli's other primary

functions that is addressed by the suggested model. The development of Waqf properties and

amenities, including a library, hostel, business center, mini-hospital, center of excellence, hotel,

convention center, and sports facilities, is typically the goal of this investment. Capital projects

can be funded by a variety of sources, including cash Waqf, business partnerships, and Waqf sukuk

(Islamic bonds). The money received from the rental of the buildings and amenities will go into a

cash pool that the Mutawalli will oversee. In addition to managing the funding sources and closely

adhering to Waqf accounting, which entails recording all collections, income, rental, profit,

expenses, and other funding sources, the mutawalli is responsible for seeking out new funding

opportunities.

Third, according to the model, the proceeds or income from Waqf assets should be placed

into three cash pools: one for the development of students (scholarships, financial aid, and the

nurturing of young scholars' talent); another for the building of faculty and academic capacity

(fisabilillah research fund, center of excellence, conferences, seminars, financial support for post-

graduate research and new innovations), and a third for non-academic and administrative support

(maintenance building, sports complex, mosque). For example, Vehbi Koc Vakfi (Koc

Foundation) has used the proceeds and income to fund Koc University's tuition, student growth,

academic research, and development, as well as the upkeep of the campus, mosque, and other

facilities. In the meantime, Pesantren DT supported low-income students, college facilities, and

building and facility maintenance by using the Waqf cash pool and income.

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3.0 ISSUE OF YUM PRIVATE UNIVERSITY

Private universities are experiencing problems in managing their financial resources due to

the economic development in the country and management costs that are increasing every year in

Malaysia. Private universities in Malaysia are also struggling with accreditation issues from MQA.

These private universities take steps to maximize profits by promoting new courses before

obtaining approval from the Malaysian Qualifications Agency (MQA) which causes difficulties

for the university in handling the course. According to Geoffrey Williams who is Professor &

Dean of the Institute of Graduate Studies, University of Science and Technology Malaysia said

that the new courses are often specialized and require specialist staff to teach.

The teaching staff will be burdened with the number of students and the management will also be

affected because they have to find new teaching staff due to the amount of salary given to them

not being enough with the burden they carry. Such issues will result in the quality of the course

being affected and MQA will suspend and reject the accreditation application after the audit

process is carried out. However, the ones who received the biggest impact were the students who

took the course which was caused by the management of the university itself. Students need to

check the accreditation status of the course to prevent such things from happening. Such issues

also contribute to the decline and public trust in the transparency and marketability of private

universities in Malaysia which will disrupt the financial resources of the private universities.

Report by Penang Institute (2015) revealed that the performance of private universities in Malaysia

lags public universities. The report covers 41 private universities, 8 foreign branch campuses and

27 tertiary colleges. The findings of the research are alarming where 28 of the local private

universities and colleges reported consistent loss on yearly basis. In the year 2013, for instance,

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46% of privateuniversities reported losses at PBT level (Profit Before Tax). Moreover, the

management of the balance sheetis also questionable. Working capital of approximately 46% of

the sample private HLI, is not encouragingreflected by insufficient assets to cover their short-term

liabilities. Surprisingly, 30% of these privateuniversities has shown signal of financial distress

(total debts exceeded total assets), some exceeded theirpaid up capital (Lim & Williams, 2015).

Many of Malaysian private universities are struggling to maintain quality and educational

standards amid a deteriorating financial situation. The reasons cited for poor financial performance

are mainly lack of business mindset, poor management, lower income generating activities, tight

financial, stiff competition and capital/ funding issues. It is worth mentioning the difficulties and

challenges confronted by HLI such as Al-Bukhari International University (closed in June 2014),

The Allianz University College of Medical Sciences (closed at the end of 2014) and Masterskill

Education Group Berhad, (now- Asia MetropolitanUniversity). For instance, Masterskill

Education Group Berhad experienced share price fall from RM4.24 in August 2010 to a low of

RM0.33 five years later (Bursa Malaysia, 24 August 2015; bloomberg.com, 24 August 2015).

Therefore, YUM needs to take more effective measures to prevent the same thing from happening

to their university. With the step of empowering waqaf carried out at YUM can preserve and help

YUM in restoring and increasing their source of income and become one of the university's sources

of income until now YUM is one of the best private universities in Malaysia that applies waqaf in

their administrative system.

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4.0 SOLVING ISSUE WITH LEGAL MAXIM

The strategy in managing Waqf property is very important to ensure that Waqf assets can

be maintained or increased to a higher amount. However, some universities in Malaysia suffer

losses that cause existing costs to be unsustainable. This is due to less efficient asset management

and asset development not being done well so that profits turn into losses. For example, among the

universities that have almost ceased operations is AiU which has suffered losses to the point of not

being able to bear the costs that the university should bear. AiU is a university that depends entirely

on waqaf. Most AiU students are disadvantaged students.

The main issue in most universities today is the limited financial resources that make it

impossible for the management to meet the welfare of the students and unable to contribute to the

development of the university. Therefore, this study was done to identify the appropriate fiqh

method to solve this issue. We are of the opinion that the fiqh method that fits this issue is:

‫الضرر يزال‬

Al-Darar (‫( الضرر‬means harm or injury, in which it's the opposite of benefit. (Ibn al-ʿArabī

1392). According to Ibn Hajar (n.d.), Al-Darar stands for infliction of harm on others. In kitab

Fayd Al-Qadir also stated Al-Darar is infringement of others’ rights (Fayḍ al-Qadīr Sharḥ Jāmi’

al-Ṣaghīr, n.d.).

There also quran verse that simillar with this legal maxim, which is:

َ ‫وا بِأ َ ْيدِيكُ ْم إِلَى ٱلت ه ْهلُ َك ِة ۛ َوأَحْ ِسنُ ٓو ۟ا ۛ إِ هن ه‬

‫ٱَّلل يُحِ بُّ ٱ ْل ُمحْ ِسنِين‬ ۟ ُ‫ٱَّلل َو ََل ت ُ ْلق‬
ِ ‫سبِي ِل ه‬ ۟ ُ‫َ َوأَن ِفق‬
َ ‫وا فِى‬

There will be retaliation in˺ a sacred month for ˹an offence in˺ a sacred month,1 and all violations

will bring about retaliation. So, if anyone attacks you, retaliate in the same manner. ˹But˺ be

mindful of Allah and know that Allah is with those mindful ˹of Him.

Surah al Baqarah: 195

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 Referring to the principle of "Ad-Darar Yuzal" in the context of Qawaid Fiqhiyyah, then it

translates to "Harm is to be removed." This principle is part of a broader set of legal maxims or

principles that guide Islamic jurisprudence. The principle of "Ad-Darar Yuzal" emphasizes the

importance of avoiding harm and removing it whenever possible.

In Islamic law, preventing harm and promoting benefit are essential principles. Scholars

use these principles to derive legal rulings in situations where there might be harm or benefit

involved. The idea is to prioritize the well-being of individuals and society and to minimize or

eliminate harm whenever feasible.

For example, if a particular action or practice is likely to cause harm to individuals or

society, Islamic law may prohibit or restrict that action. Conversely, if an action is likely to bring

benefit without causing significant harm, it may be encouraged or permitted.

It's important to note that these principles are applied by Islamic jurists to derive legal

rulings in various situations. They help provide guidance on issues not explicitly addressed in the

primary sources of Islamic law, such as the Quran and Hadith. Instead, these maxims serve as tools

for reasoning and deriving legal conclusions based on the broader objectives of Islamic law.

The selection of this fiqh method considers the harms that will be experienced when the

inefficient management of waqaf property causes the existing assets to be owned to bring losses

when not using the right strategy. MMU is a private university that is not fully dependent on the

government. Through the method of collecting waqaf property used by YUM, the university can

help a few students who are financially underprivileged.

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 Next, the management of waqaf property that is less receptive will cause harm especially

to the facilities provided by the university. This is because every facility needs maintenance.

Maintenance should require high costs every year. Failure to provide costs will result in

maintenance not being possible to the impact of the students due to the facilities that may not be

eligible for use. MMU is one of the best universities among private universities. This also needs

to be coordinated with the facilities provided by the university. The provision of facilities must

also meet the standards for institutions of higher learning in malaysia. Waqaf property

management can be used as capital to meet cost requirements.

In addition, YUM under MMU also provides scholarships to underprivileged students.

Funds from Waqf are also used to help students who need financial assistance. Therefore, the role

of waqaf fund is very important in meeting the needs of students who receive scholarships. In

addition, YUM under MMU also selects some staff who need assistance. The waqaf fund greatly

exerts a great influence on students who are performing yet do not have the financial capabilities.

In helping underprivileged students, YUM is also determined to produce excellent students

through scholarship assistance to underprivileged students. For conclusion, harm must be

eliminated which mean Inefficient management of waqaf property will lead to harm where the

assistance given to students and underprivileged staff will be delayed and other matters such as

maintenance and development of facilities will be disrupted.

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5.0 CONCLUSION

The idea of Waqf is the foundation for the growth and prosperity of some of the best institutions

in the world, including Harvard, Oxford, Koc, and Al-Azhar (Cizakca, 2011). Corporate Waqf

University (CoWU) focused on Yayasan Multimedia University (YUM) could relieve the

government of its financial burden of supporting higher education institutions (HLI) in light of the

current pressure brought on by the high cost of running universities. Based on the authors' actual

experience managing businesses and Yayasan (the foundation), where the value of stakeholders is

the primary corporate goal, this paper offers a comprehensive viewpoint. It is anticipated that the

business community will value the proposed CoWU's content and be eager to lend assistance to

its implementation.

From the issues and problems that YUM faced, we did our research and discussed the legal maxims

that can be applied to this problem. We adapt “Al-Darar Yuzal” which is one of the classical legal

maxims that suitable for the issues at YUM. This this one of the fourth major maxim and it is

means “injury must be removed”. From our opinion, we conclude that all the issues and problem

that YUM faced can be risk and effect for the university and the welfare of the students. “Ad-Darar

Yuzal” emphasizes the value of preventing harm and eliminating it whenever feasible. Most of the

problem can make harm for the university, management, students, Waqf fund and our country.

More future studies needed to support the Islamic legal maxims that applied to solve the problem

based on Islamic ways and on how to solve the problem of Waqf universities faced for the future.

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6.0 REFFERENCE

Cizakca, M. (2011). Waqf in History and its implications for modern Islamic Economies. In: Kahf
M and Mahamood SM (eds)Essesintial Readings in Contemporary Waqf Issues. Kuala
Lumpur. CERT,142.

Ab Hasan, Z., Othman, A., Ibrahim, K., Shah, M. A. M. M., & Noor, A. H. M. (2015). Management
of Waqf assets in Malaysia. International Journal of Nusantara Islam, 3(1), 59-68.

Nawi, N. H. M., & Ismail, M. (2018). Falsafah wakaf pendidikan tinggi; Satu semakan semula.

Journal of Techno-Social, 10(2).

Bakar, R., Sakinah, W., Zaini, R., & Sarmin, F. (2019). Corporate Waqf university: a

sustainability model. Journal of Emerging Economies and Islamic Research, 7(1), 24-36.

Rifin, M. K. I., Mujani, W. K., Taib, M. S. M., Suhaili, N. A., & Ismail, N. A. (2016, May).

Waqf and Endowment in Private University Malaysia. In Proceedings of the

International Symposium on Waqf and Higher Education, Istanbul (pp. 83-88).

Duski Ibrahim, 2019, AL-QAWA`ID AL-FIQHIYAH (KAIDAH-KAIDAH FIQIH), a Noerfikri,

Palembang Perpustakaan Nasional Katalog dalam Terbitan (KDT) Anggota IKAPI (No.

012/SMS/13)

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Mahamood, S. M., & Ab Rahman, A. (2015). Financing universities through Waqf, pious

endowment: is it possible? Humanomics, 31(4), 430-453.

Aziz, M. R. A., Johari, F., & Yusof, M. A. (2013, September). Cash Waqf models for financing

in education. In The 5th Islamic Economic System Conference (iECONS2013) (pp. 835-

842).

Washil, N. F. M., & Azzam, A. A. M. (2023). Qawaid Fiqhiyyah. Amzah.

Mohammed, K. (2005). The Islamic Law Maxims. Islamic studies, 44(2), 191-207.

Nyazee, I. A. K. (2019). Islamic Legal Maxims. Lulu. com.

Official site of Yayasan University Multimedia

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